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7 top U.S. growing stocks

25.02.2018

We open a new series of reviews on stocks that have seen the biggest increase in price over the past 12 months, starting with the best-performing U.S. companies.

In order to make the list, the company needed to have a market cap of at least $5 billion and a P/E ratio not exceeding 50. This ensures that the shares in question are fairly well known in the stock market and at the same time are unlikely to turn out to be bubbles.

1. Bioverativ

Company logo on the patch

Symbol: BIVV

Exchange: NASDAQ

Market cap: $11B

Annual turnover: $887M

P/E ratio: 25

Dividend yield: –

YTD performance: +143%

Description. A biotechnology company focused on the research and commercialization of therapies for the treatment of hemophilia and some other blood disorders. The two current major products are Eloctate and Alprolix, used for the treatment of hemophilia A and B, respectively.

Chart. The stock’s track record is way too short to reliably estimate the underlying trend, so for now let us just note a sharp two-fold increase in the share price in January 2018.

Pros. Best share-price gain in the review; relatively low P/E ratio.

Cons. Short track record; no dividend payout.

2. IPG Photonics

IPG Photonics office building

Symbol: IPGP

Exchange: NASDAQ

Market cap: $11B

Annual turnover: $1.0B

P/E ratio: 33

Dividend yield: –

YTD performance: +141%

Description. A manufacturing company engaged in the development and production of high-performance fiber lasers, fiber amplifiers, and diode lasers used in various industries ranging from materials processing to advanced communications to medical applications. The company’s production facilities are located in the USA, Germany and Russia.

Chart. Almost entire history of the stock’s price movement clearly exhibits a positive trend, despite temporary periods of stagnation or even decline. The stock began rising particularly rapidly at the beginning of 2017, having increased almost 2.5 times over the year, and is now trading near its all-time high.

3. Boeing

Boeing 737, the most-produced passenger aircraft type

Symbol: BA

Exchange: NYSE

Market cap: $198B

Annual turnover: $93B

P/E ratio: 25

Dividend yield: 2.1%

YTD performance: +103%

Description. One of the the world’s largest and oldest (est. 1916) aircraft manufacturing company, which also operates in the space industry. The company operates in four segments: Commercial Airplanes; Defense, Space & Security; Global Services; and Boeing Capital. The company’s main production facilities are located in Seattle, Washington.

Chart. The company’s track record is exceptionally long, so there’s no sense trying to fit it on the chart. It suffices to note that the stock shows an uneven, but overall positive trend that has led to a tenfold increase in price since 2000. Over the last 12 months, its share price rose more than twice, making 2017 one of the most successful years for the company. Now the stock is trading at the historical high. The company pays stable dividends quarterly.

Cons. Stock trading at the all-time high may indicate an increased correction risk, so it may be reasonable to wait a couple of weeks before buying in.

4. Match Group

Tinder, one of the most famous dating apps

Symbol: MTCH

Exchange: NASDAQ

Market cap: $10B

Annual turnover: $1.3B

P/E ratio: 30

Dividend yield: –

YTD performance: +100%

Description. A world-famous dating service that owns brands such as Match, Tinder, PlentyOfFish, Meetic, OkCupid, and BlackPeopleMeet. The company operates in 42 languages in 190 countries. Screenshot. Owned by Match Group, OkCupid.com is one of the world’s oldest international dating sites.

Chart. No data on the stock are available before late 2015, but since then the general trend was positive, having the price increased more than twice.

5. NVIDIA

Advertising image of the GTX 980

Symbol: NVDA

Exchange: NASDAQ

Market cap: $141B

Annual turnover: $97B

P/E ratio: 48

Dividend yield: 0.3%

YTD performance: +99%

Description. A visual computing company operating as a GPU manufacturer and a provider of highly integrated single-chip solutions. The company owns a major GPU brand GeForce and other well-known trademarks such as nForce, Quadro, Tesla, ION, Tegra. The company’s products are used in gaming, professional visualization, data storage, and automotive markets. Recently its GPUs have found an outstanding demand by the crypto-currency miners, which had some positive effect on the share price.

Chart. NVIDIA has been on the market for a long time, enjoying a fair reputation among gamers and other computer users, but it wasn’t until 2016 that its true moment of glory has come. Over the next two years, its shares have risen in price 8 times, accompanied by a comparable growth in profits (although the change in the P/E ratio indicates that the latter still fell a bit behind). The company pays a steady quarterly dividend since 2012, but the yield is now insignificant.

Pros. Sharp two-year increase in stock prices; good fundamentals for continued growth (e.g. mining); large scale of operations.

Cons. Highest P/E ratio in the review, probably indicating an increased correction risk (however, contrary to the formal evaluation rules, the ratio has mostly remained constant for about 2 years, which indicates an adequate market share price).

6. XPO Logistics

Branded XPO truck

Symbol: XPO

Exchange: NYSE

Market cap: $10B

Annual turnover: $15B

P/E ratio: 36

Dividend yield: –

YTD performance: +89%

Description. A global transportation and logistics services provider. The company’s Transportation segment directly controls the vehicles operations, while its Logistics segment offers a range of storage solutions, as well as supply chain optimization services.

Chart. The company has been operating globally for quite some time, but it wasn’t until 2016 that its shares experienced their first real rally, which, apart from a brief decline in 2015, continues to this day. Over the time, XPO share price soared as much as 43 times!

7. Abbvie

Abbvie’s logo

Symbol: ABBV

Exchange: NYSE

Market cap: $177B

Annual turnover: $26B

P/E ratio: 27

Dividend yield: 2.6%

YTD performance: +83%

Description. A young but quickly growing pharmaceutical company founded in 2013. The company’s most successful product is Humira (adalimumab), a biologic therapy for the treatment of autoimmune diseases such as rheumatoid arthritis, ankylosing spondylitis, and Crohn’s disease. Its worldwide sales amounted to more than $10 billion, having caused much excitement among investors. The company also offers a number of other medicines, but they have not received such widespread adotion. Abbvie is one of the S&P 500 Dividend Aristocrats, a select group of stocks that have increased their dividends annually for 25 years or more.

Chart. In the five years that the company has been publicly traded, its share price has increased threefold, the best periods being from 2013 to 2014 and the most of 2017. In early 2018, the stock hit an all time high, although a correction was soon to follow. The company pays a steady quarterly dividend which, while being modest by general standards, is highest amongst all companies in the review.

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